June 2019 policy briefing

This monthly policy briefing covers the latest on the impact investing, including the new institute that will open in the coming months, as well as updates on impact bonds and innovation across the world.  If you are interested in getting updates each Monday, sign up at  https://tinyletter.com/ukgolab 

GO Lab 

Conference Programme overview and keynote speaker announced – The Social Outcomes Conference will be on 5-6th September 2019 and is open to academics, researchers, practitioners and policymakers. Our keynote speaker is Stefan Dercon, Professor of Economic Policy at the Blavatnik School of Government, and former Chief Economist at DFID. See an overview of our programme and many other speakers announced. GO Lab   

Blog Show me the receipts! Evaluating the cost effectiveness of impact bonds – Clare FitzGerald, Research Fellow from the GO Lab and Lorcan Clarke, Researcher at the LSE (and former GO Lab intern) are looking at the cost effectiveness of impact bonds. There is a gap in evidence so they are conducting a systematic review of economic evaluations relating to impact bonds. Here is what they have found so far. GO Lab
 
Video Is there anything novel about social impact bonds? - Professor Carolyn Heinrich from Vanderbilt University offers her insights on this question. She was our keynote speaker at our annual conference last year, and we are excited to welcome her back this year. GO Lab

Social innovation across the UK

Opinion Five things I learned about power balance in Greater Manchester – 1) There is a role for evidence; 2) Local authorities need more power; 3) Power shifts require culture and mindset change; 4) the philosophy is bottom up, but needs senior management involvement; 5) persevere and don’t give up. Centre for Public Impact
 
Opinion Greater Manchester’s early help to avoid long term unemployment- The Strategic Lead at Greater Manchester Health and Social Care Partnership argues that joint working should address the health impact of unemployment at an early stage. Local Government Chronicle.
 
Case study The Wigan Deal - Describes the challenge, the initiative and the public impact. Useful and readable. Centre for Public Impact
 
Guidance Guide to Implementation- The Centre for Effective Services in Ireland have published an updated Implementation guide. It looks at 1) exploring and preparing, 2) planning and resourcing, 3) implementing and operationalising, 4) full implementation. CES

Social innovation across the world

News Social Finance accelerates workforce with $2.3 million funding – Social Finance announced a new round of funding to support low-income individuals into workforce training programmes. They will build on their knowledge of SIBs to develop a new Pay for Success strategy called a career impact bond (CIB). Globenewswire.com
 
Resource The government innovation atlas: the world’s best tools and resources – Apolitical have put together a collection of many of the world’s best publicly available tools, framework, report, strategies and more. A useful, easy to navigate reference guide. Apolitical

International The future of aid: How the development business is evolving – Looks at the proliferation of actors in the space, the change in financing (such as DIBs) and new ways of designing and implementing development activities. Brookings 

Opinion A fresh take on global health financing gap – The international development community is looking to the private sector for funding, such as development impact bonds. This argues that this is a cause for concern but not alarm. Devex

Report Social innovation for refugee inclusion: from bright spots to system change – This new report from the Migration Policy Institute explores how social innovation could help build public trust in refugee integration. They identify key areas that demand greater attention and new funding models, including SIBs. Relief Web 

Impact investing 

News Britain aims high with launch of Impact Investing Institute – The UK is aiming to be a global champion in impact investing with the launch of an organisation to guide one of the fastest growing fields in asset management. It will be steered by Elizabeth Corley and Harvey McGrath. Financial Times

News New independent institute to push impact investing and influence policy – The new Impact Investing Institute has been set up by the UK government but will be an independent institution. They have four objectives: i) strengthen market infrastructure, ii) increase amount of capital invested for impact, iii) improve effectiveness of capital, iv) make it easier for individuals to invest for impact. Pioneers Post

Opinion Building a financial market for the common good: the experience of impact investing in Spain – Spain has just become a member of the Global Steering Group on Impact Investing (GSG). This piece explores what this means for Spain and the best practices that are being developed. Forbes

New Zealand Investing makes an impact - A quick tour of social impact bonds in New Zealand, such as the police-affiliated youth development programme that combines family therapy, social work and counselling. New Zealand Herald 

Report 2019 Annual impact investor survey – The annual reports demonstrates the increasing scale and maturity of the impact investing industry. It draws on responses from 266 leading impact investing organisations from across the world. Global Impact Investing Network

Impact bonds 

Opinion The downside of social impact bonds – Nadine Pequeneza directed The Invisible Heart, the first documentary about SIBs. I interviewed her last year and she stayed fairly neutral, but in this article she outlines what she really thinks. ‘After three years filming the evolution of this financing model, I believe we need to consider that SIBs might be doing more harm than good’. Stanford Social Innovation Review

Australia Social impact bonds: a letter from the frontline – Part 2 of Elyse Sainty’s letter from the frontline of Australia’s foray into SIBs. She outlines her ‘thoughts and prayers’ for the their future. See part 1about SIB myths and legends. The Mandarin

Opinion No easy fixes – how Chile designed social impact bonds from scratch – Chile developed their first SIB from scratch. They looked at best practice internationally, began working closely with public organisations to help build their team in order to lay the foundation for the SIBs process. Apolitical  
 
News Project for at-risk Indigenous mothers to launch this fall – A new project in Canada targeting at-risk mothers will launch this fall after securing funding last week. This will be a two year pilot that will help 200 mothers who might otherwise be at risk of having their infant apprehended by the child welfare system. Winnipeg Sun
 
Opinion Impact bonds fall short of sustainability standards – A very brief article stating that there are a number of impact bonds that fall short of the minimum standards for sustainability set by Insight Investment. This prompts the question ‘how authentic are impact bonds?’ I can’t find any information from Insight Investment about this, but this article makes the same claim. Money Management

News Delaware experiments with first social impact bond to fund blood bank – This article shares a description of Delaware’s first SIB that aims to boost blood donations across the state. One outcome they are aiming for is an annual increase of 500 units from young donors each year for three years. Delaware Business Times

International Social impact incentives? A new tool for supporting impact – Building off DIBs and blended finance, social impact incentives are being piloted to use donor funding to pay specifically for impact. They are similar to SIBs but used to support for-profit enterprises. Devex 

Opinion World leaders urged to think creatively to boost dwindling global health funds – This article offers the ‘top innovative financing tools existing today’ - one of these is impact bonds. The others include an airline levy micro tax and the product (red) logo used by large multi-nationals to raise funds towards the fight against HIV/AIDs. The Telegraph 

Outcomes based contracts 

Blog Pay for success faces a funding gap – This article argues that efforts to increase funding for pay for success must embrace how risk affects the expectation of returns to attract capital from the appropriate investors. Stanford Social Innovation Review

Policy brief Building an outcomes orientation for service providers – This brief looks at enhancing capacity to participate in performance based funding models. It acknowledges the importance of data infrastructure, increasing staff capacity and willingness to shift to an outcomes orientation. It offers practical reflections and recommendations.The Urban Institute

Outsourcing in the UK 

Opinion Probation outsourcing is a case study in failure - Argues that bringing probation services in-house was the right decision and the Government must learn from the mistakes which make it necessary. Institute for Government
 
Opinion Why councils are bringing millions of pounds worth of services back in-house – Argues that after 40 years of awarding contracts to the private sector, insourcing is now the way to cut costs and improve quality. The Guardian
 
Academic research Transforming Rehabilitation: The micro-physics of market power – This paper looks at the impact of the introduction of competition and profit in the probation services in England and Wales following TR reforms. A heavy read, see page 16 for the conclusions. Punishment and Society